Income statement information for Sadie Company is below: Sales $185,000 Cost of
ID: 2827415 • Letter: I
Question
Income statement information for Sadie Company is below:
Sales
$185,000
Cost of goods sold
115,000
Gross profit
$ 70,000
Selling Expenses
25,000
Administrative Expense
10,000
Total Expenses
$35,000
Income from operations
35,000
Income Tax Expense
10,000
Net Income
$25,000
Using vertical analysis of the income statement for Sadie Company, determine the gross profit margin. Round to the nearest whole number.
show all work
Income statement information for Sadie Company is below:
Sales
$185,000
Cost of goods sold
115,000
Gross profit
$ 70,000
Selling Expenses
25,000
Administrative Expense
10,000
Total Expenses
$35,000
Income from operations
35,000
Income Tax Expense
10,000
Net Income
$25,000
Using vertical analysis of the income statement for Sadie Company, determine the gross profit margin. Round to the nearest whole number.
Explanation / Answer
gross profit margin for the company = 1 - 115/185
gross profit margin for the company = 38 %